• Search 

Article




call for papers

Volume: III, Issue: II, July - December 2012


RURAL ECONOMIC DEVELOPMENT THROUGH FARMER’S CO-OPERATIVE SEZ: CAN THIS BE A VIABLE ALTERNATIVE TO THE CORPORATE SEZ IN RURAL INDIA?







Abstract

Inspired by the success of the Special Economic Zones (SEZs) in China, the Indian government introduced a similar policy through the SEZ Act in June 2005. This policy consists of extending fiscal concessions to foreign as well as domestic corporate developers to set up either single or multiple product SEZs. The land needed for these SEZs would be acquired by the government for the private corporate promoter. The aim of this policy was to encourage investment, exports, flow of foreign exchange and employment. That substantial benefits, in terms of foreign exchange inflows, higher employment and general development, can accrue to the country through this kind of development is quite certain. However, the distribution of these is most likely to be skewed. On the one hand are the promoters of SEZ, the companies who will make profits and people who live and work here amidst world class amenities. On the other hand are the farmers whose lands will have to be acquired to build these SEZs who will lose the only income generating asset that they have and get only a one time payment in return. This skewed distribution of the potential benefits is reflected in the responses of the two groups. The corporate sector has responded by flooding the government with applications for setting up such SEZs where as farmers who stand to lose their land are protesting against this policy.



Keywords Content

Introduction

Inspired by the success of the Special Economic Zones (SEZs) in China, the Indian government introduced a similar policy through the SEZ Act of June 2005. This policy consists of extending fiscal concessions to foreign as well as domestic developers to set up either single product or multi-product, single sector SEZs. The land needed for these SEZs would be acquired by the government for the private corporate promoter. The SEZ would also enjoy several other benefits such as being “exempted from a slew of taxes, duties and devoid of effective labour laws and with restricted entry against identity cards” [Kothari 2006].

The aim of adopting the SEZ policy was to promote “foreign direct investment (FDI), flow of foreign exchange and to generate employment” [Kothari, 2006]. That substantial benefits, in terms of foreign exchange inflows, higher employment and general development, can accrue to the country through this kind of development is quite certain. However, the distribution of these benefits is most likely to be skewed. The skewed distribution of the potential benefits is reflected in the responses of the two groups. On the one hand, the promoters of SEZ, the ompanies which operate in these and the people who will live and work here amidst world class amenities are welcoming it as seen in the growing number of applications for setting up SEZs. On the other hand, the farmers whose lands will have to be acquired to build these SEZs are protesting against this policy by refusing to sell their land, by anti-SEZ demonstrations etc.

However, amidst the farmers’ protest an innovative and positive response is also being noted from several places where in, not only are farmers protesting the government policy of SEZ by non co-operation, but are going further in setting up some of their own variations of a SEZ. An important related development is that the acquisition of land, particularly agricultural land, for the proposed SEZs has become the focal point of the debate. Farmers are reluctant to part with their land, where as industry is looking to government to provide them with this resource if the SEZ concept has to succeed.

Objective of the Study and Structure of the Paper

Considering these developments, this paper looks at the various farmers’ initiatives at forming co-operative SEZs emerging at various places in the country. The objective of the study is to analyse these initiatives for their merits vis-a-vis the corporate SEZ and to evaluate their feasibility and replicability. The first section of the paper, examines the theoretical and empirical findings with regard to the contributions of the SEZ to economic growth of a country. The second section examines the gains from the Indian SEZ policy. In the third section, we look at the reactions of the farmers and farmers’ groups including the innovative responses in the form of farmers’ co-operative SEZs. In the fourth sections, we analyse the impact of the SEZ policy, the potential for the emergence of farmers’ SEZs, and the implication of this for rural industrialization and development and fifth section deals with policy recommendations.

1. Theoretical Indications on the Impact of the SEZ Policy: Comparison of the Chinese and Indian Policy Environment

A Special Economic Zone (SEZ)1 is a geographical region, with economic laws that are more liberal than a country's typical economic laws, identified with the aim of increasing foreign investment. One of the earliest and famous Special Economic Zones were founded by the government of the People's Republic of China in the early 1980s. The most successful Special Economic Zone in China, Shenzhen has developed from a small village into a city with a population over 10 million within 20 years. Following the Chinese examples, SEZs have been established in several countries, including Brazil, India, Iran, Jordan,Kazakhastan, Pakistan, Philippines, Poland, Russia, and Ukraine [Leong 2007].

Special Economic Zones have become a popular tool for many developing countries to enhance growth and development. So the questions that arise are: Are SEZs a way to achieve rapid economic development? What role can SEZs play to enhance a country’s investment, exports, foreign exchange earnings and income? The following discussion attempts to answer the question based on two studies, namely of Leong [Leong 2007] and Kundra [Kundra 2008].

Leong investigates the impact of the opening up the Chinese and Indian economies, including the SEZ policies, on economic growth in these countries. His results support the fact that export growth does have a positive and statistically significant effect on economic growth in these countries. However, he finds that the growth rates of these countries are export and FDI inelastic, in the sense that a one percentage point increase in growth rate of export or FDI will have a less than one percentage point increase in economic growth rate of these countries.

Further, he contends that in both countries, the second stage of liberalization is statistically significant because the scale of liberalization is greater in the second phase. Additionally, he finds that increasing the number of SEZs has a negligible effect on economic growth. His results suggest that a greater scale of liberalization contributes to greater growth, rather than increasing the number of SEZs. [Leong 2007].

Kundra compares the Chinese and India SEZ policy to assess their potential for success. According to Kundra, the Chinese SEZs have proved successful because of their distinguishing features of large size, investment friendly customs regime, flexible labour laws, liberal policy for DTA (Domestic Tariff Area) access, attractive package of incentives and delegation of powers in favour of provinces and local authorities for managing the zones. Kundra contends that most of the Indian SEZs, though larger than the earlier Export Processing Zones (EPZs), are much smaller compared to the Chinese SEZs. Regarding customs regime, the Chinese SEZs provide tremendous operational ease and in the Indian case too, the customs regulations are much less cumbersome than those for EPZs. The incentives given for the Indian SEZs are more liberal than those for the Chinese.2 However, he says that where Labour Laws, Decentralisation of power and DTA are concerned, the Indian SEZ policy falls short of expectation. China relaxed its labour laws by allowing a hire and fire policy for SEZs and this resulted in attracting a lot of foreign investment to these zones. And over time as the investors gained confidence in the Chinese workforce productivity, the hire and fire policy was substituted by the contract system. Further, the Chinese SEZs have a decentralized approach, with provincial and local authorities having authority to sanction a SEZ proposal of upto $30 million. This, according to Kundra, has been a key contributor to the success of the SEZs in China [Kundra 2008].

According to Kundra, the Indian SEZ policy is too centralized as compared to the Chinese, and this may curtail the progress of the SEZs as the local bureaucrats may have no incentive to push the proposal forward. Finally, talking of the DTA, Kundra posits that the policy of levying full import duty on DTA sales will bar the entry of the units based on indigenous inputs into SEZ, since such sales will not be viable for them. Moreover, the policy in this regard for EPZ/EOUs is much more attractive. Hence the SEZs will attract import intensive investment with low net foreign exchange earnings. Thus, Kundra, advocates the need for a decentralized approach, relaxation of labour laws and rationalization of duty on DTA access for the Indian SEZ policy to be successful.

Apart from the possible success of the SEZ policy, an important aspect not touched by both the authors reviewed above, is the treatment of the unequal distribution of gains that will result from the adoption of the SEZ policy. That the SEZ policy will bring in gains is not debatable, but what is debatable is the equitable distribution of these gains. The question of how to address this issue remains.

2.0 The Indian SEZ Scenario

Since the announcement of the SEZ policy in 2005, the Indian government has received several corporate applications. By August 2006, 360 SEZs had been cleared across the country. These are spread over several states, mainly in Tamil Nadu, Rajasthan, Gujarat, Andhra Pradesh, Punjab, Uttar Pradesh and Maharashtra and Karnataka in sectors like engineering, textiles, IT, telecommunications, multi-products, shoes, gems and jewellery, non-conventional energy, bio-technology and pharmaceuticals. In terms of geographical area, the SEZs range from 7,500 hectares to 30,000 hectares.

By March 2012, according to Mr. Anand Sharma, Union (Indian) Minister for Commerce and Industry, the government had approved 587 SEZs of which 380 have been notified and 154 SEZs are operational. Further, as on December 2011, a total of Rs 249,631 crores had been invested in the various SEZs generating direct employment for 8 lakh people. The combined exports from these SEZs increased to Rs. 315,868 in the financial year 2011. Exports grew at 25 % in 2011 over the previous year and SEZs account for 25 % of India’s export earnings. [Financial Chronicle, 21st March 2012].

2.1 The Expected Gains for Industry and Economy

It is contended that the tax concessions given to these SEZs will harm the revenue collections adversely and therefore the amount of gains derived from SEZs as described above, are not net gains as they do not account for the tax concessions given to the SEZs. However, according to the Economic Survey, “Benefits derived from the multiplier effects of the investments and additional economic activity in the SEZs, along with the additional employment generated, is estimated to far outweigh the revenue losses on account of tax exemptions given to the SEZs. [ET 29th February 2008].

Further, there are apprehensions that these SEZs are not giving rise to new industries and investment but are actually enabling a relocation of existing industries due to the tax sops and other benefits. Hence the question is how much of new investment and employment is actually being generated? To this the Economic Survey claims that “Experience has shown that these apprehensions are ill-founded and fresh investments have been flowing in the SEZs [ET 29th February 2008].

There are other concerns as well with regard to the proliferation of the SEZs. One major fall out of this policy and the overall infrastructural development in the country is that land has become scarce and the market for land has heated up. There appears to be a tussle between the industry and agriculture for land. Since a SEZ requires vast amounts of contingent land, large scale land acquisitions are rapidly taking place. Here the concern is that prime agricultural land will be acquired for SEZs. To prevent this States have been advised to give priority to acquisition of waste land and barren land and if necessary, single crop land for SEZs.

3.0 The Farmers’ Response: Protesting Against Land Acquisitions

The land acquisition process for some SEZs is already underway and land is also being acquired by other industries. Farmers and farmers groups are protesting vociferously against this. Protests against land acquisitions by farmers are noted from all over the country. For instance, protests were seen in Hinjewadi SEZ, Pune3, in Shimla UP4, in Haryana5, in Satara6, in Shirur (Pune)7. The farmers fear that they will lose their land and not find employment in the automated factories that come up.

In one case, victory for the farmers’ agitation from the villages of Wagholi, Kesnanad, Lonikand and Bakuri (30 kms from Pune, Maharashtra) was achieved when the state government recently denotified the land acquisitions for the corporate SEZ of the Videocon group of companies in August 2009. [TOI, 28th Aug, 2009] The state government had notified the SEZ in 2006 for 1,940 hectares of land. However the farmers here protested against the corporate SEZ and the land acquisition and were finally successful in getting it scrapped.

In Maharashtra, so strong is the opposition to Land Acquisition that the Maharashtra government had to cancel major SEZs proposed by large business houses, namely, Mahindra, Videocon, and India Bulls. [IE, Pune, 31st July 2012] and denotify nearly 8700 hectares of agricultural land of the locals [TOI Pune, 1st Aug. 2012].

If the SEZ Act comes under the ambit of the National Land Acquisition and Resettlement and Rehabilitation Bill 2011, land oustees may be better satisfied and may be ready to accept corporate SEZs and lease/sell their land for these. However Commerce and Industry Minister, Mr. Anand Sharma’s statement to the Rajya Sabha in March 2012 that several requests have been received for denotification of SEZs in view of taxation issues and slow down in target markets, should be noted in this context. [Financial Chronicle, 21st March, 2012]. This statement indicates that SEZs are being denotified for want of adequate market. Hence it seems that it is not due to difficulties in land acquisition alone that SEZs are being denotified. From this it appears that unnecessary expansion of corporate SEZs in rural areas may be of little use in terms of revenue and employment generation if there aren’t adequate markets to support these.

3.1 Some Innovative Responses: Farmers’ SEZs

Apart from protesting the land acquisitions for SEZs, farmers from several other places are reacting to the land acquisitions for SEZs in an innovative way by taking the initiative in promoting income generating projects on their own. Their stance appears to be that they do not need the corporate SEZs to give them employment and income, in return for their farm lands. They can create these for themselves. In this section, we present five such innovative responses from across the country.

3.2 Case 1

In Avasari Khurd village (about 40 kms from Pune) in the Ambegaon sub-district of Pune district,8 the farmers, led by Sopan Bhor, have taken the initiative in setting up their own SEZ in 2007 [IE July 7th 2007.] About 1500 farmers of the village are planning to set up a company by the name, “Avasari Khurd Industrial Development Pvt. Ltd”. This farmers’ SEZ has been proposed on barren land worth Rs 900 crores. Sopan Bhor decided to undertake this SEZ when the government decided to build an airport about 20 kms from his village. Anticipating that land prices would rise, he wanted the farmers to benefit from this price rise for a longer term rather than sell off their land to some corporate for a one time hefty payment. About 18,000 people stay in the village and as per Sopan Bhor’s plan, not only will villagers get jobs but the farmers will also be owners of the SEZ.

The farmers’ SEZ has been proposed as private Ltd. company in which the farmers will be shareholders and not as a co-operative because the co-operative law in India does not permit profits beyond a certain limit where as he wants the farmers to profit from this venture. Mr. Bhor adds that part of the SEZ land will be reserved for farmers to set up their own enterprises and the rest will be leased out for profits. Further, Mr. Bhor says that the companies who decide to set up their factories in this SEZ will not be obliged to absorb local labour as he wants the farmer-owners of this SEZ to benefit from this venture as owners and not as employees or workers.

The land use plan is as follows: Out of a total land of 6220 acres, the proposed company plans to use 2,665 acres for agriculture and 2,489 acres for industrial development. The remaining, 1,066 acres will be set aside for residential purposes. The shareholder farmers will put in the initial investment like laying roads, creating gardens, drainage facilities etc. Various sectors are proposed to be accommodated in the SEZ, like automobiles, electronics, IT and chemicals. This initiative has drawn farmers from other areas like Nashik and Nigunje to study their venture [Jadhav Radheshyam TOI 16th January 2008.] and news channels to cover this experiment on television. The State government had given an in principle approval to this proposed farmers’ SEZ and had sent it to the Central government for approval.

However, this farmers’ SEZ has its own share of problems with some farmers withdrawing and forming “Shetkari Bachao Kirti Samiti” and opposing the idea of a farmers’ SEZ in their village. [Express News Service IE 28th January 2008]. However, in our discussion with Mr.Sopan Bhor, he clarified that despite this, he is confident of carrying the project through. Apart from participation procuring infrastructure finance too may be a problem.

3.3 Case 2

Another co-operative SEZ is seen Girner village in Aurangabad district of Mahrashtra. As per a newspaper report a civil engineer turned farmer, Mohan Raut, has taken the lead in establishing this small SEZ admeasuring about 25 acres visualized as an IT park under the “Rajiv Gandhi IT Park Co-operative Society”. It began with 5 to 7 members but now after the SEZ concept there are 250 members. The state and Central government approvals are in place and fifteen units proposed in this SEZ have already been booked. The society has raised a capital of Rs. 2.5 crores from 250 members and the state government is expected to give 10 % of the share capital9 [TOI 1st February 2008.]

3.4 Case 3

In Nigoje village of Khed sub-district of Pune district, 75 farmers, whose lands were acquired for the Chakan Maharashtra Industrial Development Corporation (MIDC) Phase IV SEZ, have joined hands to form the “Nigoje Logistic and Services Company Limited”. The MIDC scheme (for farmers whose land has been acquired for industrial purposes) allows the farmers to buy back 15 percent of the land once it is developed and lease it to the company for a permanent source of income. Under this the farmers have bought back 32 acres of land to form the company which will be used to provide various services including transportation, construction and warehouses. This policy of MIDC of allowing the buy back option to farmers, (where the farmers can buy back 15% of the land after it is developed after paying the original cost and 50 % additional) is resulting in formation of several farmer companies in this area. [Times News Network TOI 10th May 2008].

3.5 Case 4

In Chinchwad area near Pune, Maharashtra, farmers’ activist Dattatray Sane, along with others is advocating an idea of a special township project among the farmers by developing 500 acres of land near Chinchwad (near Pune) on the lines of the Magarpatta township project at Hadapsar, Pune. Magarpatta city, developed as a modern township on lands held previously by farmers, is a scheme successfully implemented where the farmers got a good value for their land. Sane has been mobilizing opinion among farmers on this and says that most have agreed. [Manish Umbrajkar TOI 28th April 2008].

3.6 Case 5

An innovative alternative to the SEZ has been proposed by Ganesh Devy, an activist in Gujarat and founder of the tribal advocacy NGO Bhasha. He is proposing what he calls a “Green Economic Zone” (GEZ) where he plans to use women of the Self Help Groups (SHGs) and the land of seven districts and 2200 villages on the eastern tract in Gujarat to grow corn. The plan is to produce a substitute for Kellog’s cornflakes, right from growing the corn to manufacturing the flakes to be organized as a “co-operative industry” somewhat on the lines of the AMUL10 model.

Devy opines that “before Gujarat’s eastern tribal belt is saturated with corporate SEZs and the tribals are shunted out, Bhasha has drummed up a solution rooted in agriculture and local culture. The tribal members of this co-operative, called Chaitanya Samiti, will be guided by a development consultant who will evaluate their system, shadow their progress along a time line and steer them to the most optimal route to the GEZ. The plan also includes shifting the agriculture to organic agriculture and therefore the name, Green Economic Zone.

According to reports although most of the people are enthused by it, Devy is not unaware of the problems that the venture might face. Providing the necessary infrastructure like irrigation, transportation, cottage industry, marketing and distribution will be necessary before the GEZ can really take off. Moreover, since different tribes are involved, getting them to participate in this, given their varying socio-economic backgrounds is a tough job which will require leaders. [TOI 14th July 2008]

4.0 Analysis and Conclusions

From the above discussion, it is apparent that differential gains are being perceived by different groups affected by the Indian SEZ policy. The farmers who stand to lose land are most vulnerable as they have no alternative means of earning a livelihood. Even if they are promised jobs in the corporate SEZs that would come up, they realize that these may take some time to materialize. Moreover, as the situation is uncertain, farmers are reluctant to accept corporate SEZs on their lands. Hence, farmers and their leaders are either trying to stop the corporate SEZs from emerging or are trying to set up their own SEZs. Although the latter attempts are laudable, they are fraught with their own problems.

A farmers’ SEZ seems an appropriate model for village industrialization, rural employment and income generation. Under this, villagers instead of losing their land and getting a one time payment with which they do not know what to do, would get ownership in the industry and probably an income stream too. This, therefore, seems to address the twin problems of rural industrialization and employment.

However, so far, these innovative responses of farmers’ SEZs are very few. They have come from places where there are dynamic individuals who have visualized this concept and are keen to implement it too. Even in these few cases, the path is strewn with obstacles- the main one being readying the farmers to participate and co-operate for such a venture. As seen in Case Study 1, the farmers had agreed to the concept of farmers’ SEZ earlier but later some backed out and took an anti- SEZ stand. Further, even if farmers are willing to form and execute the idea of a farmers’ SEZ, they may not be equipped to succeed in the competitive environment. Here, the role of a development consultant as seen in the 5th Case study, could help such ventures to take off and stabilize.

The strength of a farmers’ SEZ in the rural area is that it can be linked to the local market instead of exports and therefore can be sustainable and useful for overall rural development; moreover farmers would have a greater stake in making it successful. The weakness of such a SEZ would be that income generation and employment may be limited if it is linked to the local market and not to the international market. Another weakness could be the farmers’ lack the skill, vision and business acumen to work in competitive industry. Such a SEZ would however bring opportunities for industrialization in rural areas for generating industry based employment and overall development of the area. The threats inherent in the implementation of such a policy are failure of such SEZs due to sudden changes in policy, changes in markets or due to local politics.

About replicating this idea of a Farmers’ SEZ at different places, it seems difficult on its own until a very successful case emerges which can have a strong demonstration effect, like that of the AMUL model. Once one venture becomes successful, the hurdles faced by it and the solutions provided by it can help other fledgling ventures. Of all possible inputs, the key input in the given circumstances seems to be the desire within the farmers to have industrialization through such ventures. Only when this is strong, will such ventures take off and be sustainable. And in case farmers’ SEZs do proliferate, they can become the single point solution of rural industrialization, rural employment, rural incomes and overall rural development. And it is for this reason that these kinds of efforts should be and need to be promoted in all the ways they can be.

One way of enabling farmers’ SEZs to become a successful reality, is to co-opt farmers in the corporate SEZs as co-owners, instead of acquiring their land. As an activist leader, Bharat Patankar of the “Shramik Mukti Dal” opined that instead of a sale of land by the farmers to companies, companies should acquire the land from the farmers on a rental basis and the farmer must be given a yearly income which he supposed to get from the field [Vivek Waghmode IE 9th May 2008]. However, this pattern of ownership needs to be thoroughly studied and examined for its impact.

5.0 Policy Recommendations

Two policy recommendations seem to emerge from the paper. The first is that farmers’ land, instead of being sold to the promoter under the SEZ Act, could be leased or rented. This will ensure that the farmer is not deprived of the ownership of his land and is also assured of an income stream. Moreover, this may ensure that a part of the burden of the lease is passed on to the promoter. Promoters will then take up projects which are profitable and sustainable. This will then check the tendency of corporate SEZs being undertaken because of government sops and, it will ensure that the farmer becomes a co-owner in the enterprise. However, this model needs to be examined thoroughly to assess its possible impact on all stakeholders.

The other recommendation that emerges is that just as the government is supporting the corporate SEZs (by procuring contingent land and fiscal concessions) in its adoption of the SEZ policy, it should also further farmers’ interest by promoting and assisting farmers’ co-operative SEZs wherever they emerge. To this end, there is already a provision that the government will provide 10 % of the capital if the farmers’ co-operative can raise some on their own. These kind of incentives need to be increased, strengthened and more importantly, made well known.

Apart from this, more importantly, government can also take proactive steps in this direction by setting up a Model Farmers’ SEZ, getting it off the ground and functional as it did in case of AMUL. Another suggestion in this regard is that independent Development Consultants, (like agriculture extension workers) required by such farmers’ co-operatives can be appointed by the government so that they can give the strategic inputs needed.

From all the above, it appears that Farmers’ co-operative SEZs have the potential to bring about rural industrialization and to ensure a more equitable distribution of the gains from rural industrialization, if these are encouraged and nurtured in the right direction by the government. Moreover, these can very well co-exist with private sector corporate SEZs in rural areas, so that gains from both are maximized and are more equally distributed than is happening in the current scenario.

NOTES

1. The category 'SEZ' covers a broad range of more specific zone types, including Free Trade Zones (FTZ), Export Promoting Zones (EPZ), Free Zones (FZ), Industrial Estates (IE), Free Ports, Urban Enterprise Zones and others.

2. Incentives for Indian SEZs are duty free import of capital goods and raw materials, reimbursement of Central sales tax, tax holiday for a specified period, 100 percent reparation of profits for subcontracting facilities allowed, and incentives for the infrastructure sector to zone developers. (Kundra, 2008).

3. The land acquisition drive for the Hinjewadi Phase IV SEZ (near Pune in Maharashtra) saw a violent protest by the villagers of Maan and Rajgurunagar agitating against it, [Kothari, 2006].

4. Farmers of half a dozen villages held a protest outside the office of the Deputy Commisioner in Shimla, UttarPradesh and submitted a memorandum to the Deputy Commissioner conveying that no agricultural land should be diverted for the construction of an airport [Ashwani Sharma IE, 21st March, 2008].

5. Twenty two villages in Haryana have come together under the umbrella of “Shivalik Area Kisan Sangarsh Samiti” to fight against the land acquisitions by the Haryana Infrastructure and Industrial Development Corporation and the company, “Nano City”. The “Nano City”, is a joint venture project of the Haryana Infrastructure and Industries Development, a government undertaking and a private firm.The farmers’ organization, is vigilant about any farmer selling his land to the Company. They fan across the villages at night whenever there is a rumour regarding any villager selling his land to the company and prevent it [Sukhdeep Kaur, IE, 3rd May, 2008].

6. In May 2008, villagers from Chikhali village in Satara, Maharashtra stalled the functioning of 60 windmills belonging to Suzlon, a private company, because the company had failed to fulfill its assurances with respect to land acquisitions. They are demanding that Suzlon return their land as it had been “grabbed” from them [Jagtap, Ram, IE 7th May, 2008].

7. On 25th March, 2008, hundreds of farmers protested at Karegaon in Shirur taluka Pune District, Maharashtra against the SEZ scheme of the government. The protest was part of the nationwide campaign against SEZs. The main demand was that a national debate should be held on agriculture, land acquisition and development. The government is acquiring about 4000 acres of land under the SEZ in Karegaon, in Shirur taluka, Pune district, against the wishes of the farmers, according to Bhai Vaidya, an activist leading the farmers. The farmer-protestors are demanding that the government withdraw the land acquisition notices issued to people in the village. The villagers fear that they will lose their land and not find employment in the factories that come up. “The factories are automated and manpower is hardly required and the farmers stand to lose,” says Bhai Vaidya (Times News Network, TOI, 26th March, 2008).

8. This case is based on newspaper reports and a detailed interview with Mr. Sopan Bhor, an engineer and industrialist belonging to the Avasari Khurd village.

9. For co-operative societies the state government has been extending financial assistance to the extent of ten percent of the share capital mobilized by it (Prafull Marpakwar, TNN, TOI, 1st February, 2008).

10. AMUL is a very successful dairy co-operative of farmers in Western India which was developed from a small dairy co-operative to a huge one by Dr. Verghese Kurien who was appointed by the government.

REFERENCES

Hirschman Albert, O. 1958. “Linkage Effects and Industrialization” in Gerald Meier (Ed)(1990), Leading Issues in Economic Development, Fifth Edition, OUP, Oxford.: p.283-288.

Kothari, Vishwas. 2006: “NDA Government Launched SEZs to Generate Employment” in Times of India, Pune Edition, dated 27th August 2006

Kundra, A.K. 2008: “SEZs: How Well Will They Perform?”, in Hindu, 1st August, 2008.

Leong, Chee Kian. 2007: “A Tale of Two Countries: Openness and Growth in China and India: Dynamics, Economic Growth, and International Trade” (DEGIT) Conference Paper. Downloaded from http://www.ifw-kiel.de/VRCent/DEGIT/paper/degit_12/co12_042.pdf.

Sangvai, Sanjay. 2007. “The New People’s Movements in India”, Economic and Political Weekly, December 15, 2007.

Sen, Arunava. 2007. “The Theory of Mechanism Design, An Overview”, in the Economic and Political Weekly”, December 8, 2007. p.8-13.

Sharma, H.R. 2007. “Land Distribution and Tenancy among Different Social Groups”, Economic and Political Weekly, October, 13, 2007. p. 4183-4185.

The Economic Times (ET), Mumbai Edition, various issues.

The Indian Express,(I.E.) Pune Edition, various issues.

The Times of India,(TOI) Pune Edition, various issues.

The Financial Chronicle, 21stMar, 2012.